Water shortage

Driving down Interstate Freeway 5 (I-5) through California's central valley, dubbed the bread basket of the world due to its rich farmland, I noticed some peculiar signs next to miles of browned-out fields, due to lack of irrigation. One sign seemed to be reasonable: Food Grows where Water Flows. But then the signs became increasingly hostile: No Water = No Jobs = No Future. The last one was a clincher: Congress Created Dust Bowl.

I had earlier purchased a water utility, and methinks a more comprehensive water play is in the cards, whether it's desalinization, pumps, filters, or water purifiers. Warren Buffett's Berkshire Hathaway made a large investment in a water company earlier this year. Not only is the drought causing supply disruptions, but demand is increasing due to population growth and industrial use. For instance, mining companies have been especially active with the Chinese hoarding natural resources, and drilling activities utilize massive amounts of water.

Do your part and conserve water--it ain't free. Oh, and by the way, obtaining a core holding in wheat, corn, and soybeans wouldn't be a bad idea either. Crop yields are diminishing this year due to droughts and floods. Yields were at all-time highs last year, and we still experienced food shortages.

Disclosure: I recently sold out of my commodities holdings, but investigating a re-entry point. I am currently long one water utility.